Bitcoin extends gains amid Bank of Japan rate hike while DeFi tokens rally | FXStreet

The crypto industry faced setbacks this week. A Senate vote on the Clarity Act failed, opposed by banks including JPMorgan, citing risks to local economies. The Federal Reserve raised interest rates, with Chair Kevin Warsh noting no improvement in inflation data. These events may negatively impact Bitcoin prices, according to the author.

The Bank of Japan raised its benchmark interest rate by 25 basis points to 1.25%, citing inflation risks. Bitcoin's price topped $77,000, while the yen depreciated against the dollar. The move follows the Fed's rate hike and may impact global markets.

The Federal Reserve raised its benchmark rate to 3.75%-4%, citing elevated inflation. Bitcoin briefly dipped below $76,000 but recovered to $76,611. Spot bitcoin ETFs saw $746.3 million in outflows over two days, with BlackRock's iShares Bitcoin Trust and Fidelity's FBTC experiencing significant withdrawals. The Fed projects a year-end rate of 4.1%, with most officials expecting further hikes in 2026.

The crypto market rebounded after the Federal Reserve's expected 25-basis-point rate hike, with Bitcoin recovering above $76,000. Analyst Crypto Dan noted falling Bitcoin UTXOs in loss, suggesting reduced risk of a bear cycle. Major cryptocurrencies like Ethereum and BNB also saw gains, while others like XRP and Dogecoin declined. The Fed's decision was largely anticipated, minimizing market shock. Total market capitalization rose to about $2.62 trillion, with varied performance across assets.

Bitcoin's price dropped after the Senate failed to advance the CLARITY Act and the Fed raised rates. Santiment noted a shift from extreme FOMO to neutral sentiment. CryptoQuant reported a rising Bitcoin hashrate, which may support price trends, though the relationship is complex.

NEAR Protocol (NEAR) surged 22% to $2.98 after launching confidential perpetual trading with Hyperliquid. Trading volume rose 120.4% to $1.24 billion, and market cap reached $3.9 billion. The platform enables private leveraged trades across 35 blockchains, with Hyperliquid handling derivatives execution.